TL;DR
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Luban introduces a pre-settlement layer (LingLong) that lets Ethereum validators delegate rollup sequencing duties while maintaining control.
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Validators can earn additional revenue by monetizing future blockspace rights through secure, restaked commitments.
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Delegation is flexible, supporting both native (validator’s own ETH) and external restaking.
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Restaked Validator Service (RVS) enables validators to delegate specialized tasks without running complex infrastructure.
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Restaked Gateway Service (RGS) handles sequencing marketplaces and channels value back to validators.
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Slashing risk is isolated to the delegated layer—validators are only penalized for direct misbehavior (e.g., missing or replacing settlements).
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Validators remain protected from pricing and regulatory risks, thanks to clear operational and legal separation.
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Supports MEV-Boost and PBS, so existing block rewards remain intact.
Background
Preconfirmation
Preconfirmation, in the context of Ethereum L1, refers to a type of commitment issued by a validator to a transaction owner before the transaction is included in a block, that the transaction will be included/executed in the validator’s upcoming slot. It provides much faster confirmation to users compared to Ethereum’s 12s block time.
Blockspace Futures
Blockspace futures, a primitive that the Luban team has been working on since late 2023, are commoditized future blockspace that can be sold by future proposers. It is able to deliver all functionalities that preconfirmation has, but is fundamentally different in that blockspace futures is not tied to specific transactions. Instead, it can be seen as empty blockspace that is fungible and can be traded on secondary markets. The fungibility enables more use cases than preconfirmation, including bulk-selling blockspace to redistributors (wallets, oracles, etc.), gas fee hedging, and more.
Based Rollup & Based Preconfirmation
Based rollups are rollups whose transaction sequencing is driven by the Ethereum L1. They inherit decentralization and liveness from the L1, and are inherently more interoperable with the L1 because of the transaction sequencing of both domains are unified. They are deemed to be one of the most promising scaling solutions for Ethereum.
Currently the biggest pain point in based sequencing is speed. Users of a vanilla based rollup like Taiko today must wait for the rollup batch to be settled on the L1 before they can receive transaction confirmation. This makes the rollup as slow as the Ethereum L1. Therefore, multiple solutions (like this and this) have been proposed to provide “based preconfirmation” to based rollup transactions, hoping to provide user experience on par with centralized sequencer rollups.
The Problem
Based preconfirmation introduces two key challenges:
- Cold Start: Each based rollup must independently bootstrap and maintain its own validator network, leading to duplicated effort and resource inefficiency as the ecosystem grows.
- Scalability: It’s impractical to expect every single Ethereum validator to run 1000 sidecars and sequence for 1000 based rollups.
A new framework is needed to connect validators and based rollups, balancing three criteria:
- Universality: Minimize overhead for adding new rollups.
- Flexibility: Support diverse rollup requirements.
- Basedness: Maintain validators’ ultimate control and L1 composability.
Critically, Ethereum validators must remain central to this framework, ensuring they benefit from—and contribute to—the growth of the based rollup ecosystem.
The Pre-Settlement Layer
Luban presents pre-settlement, a proposer commitment framework that enables Ethereum validators to delegate their based rollup sequencing rights to third parties. Its implementation, LingLong, functions as a PBS (Proposer-Builder Separation) platform for based rollups. Through restaking-secured credible commitments, rollups can be considered “settled” even before L1 settlement, as validators are obligated to accept state updates from their chosen gateways.
Pre-settlement vs. PreconfirmationIn preconfirmation, the ‘preconfirmer’ must be the proposer of the next Ethereum block to guarantee absolute settlement certainty for the preconfirmed transactions—since the proposer controls the block. A preconfirmer who is not the proposer cannot offer the same level of assurance.
Pre-settlement decouples the roles of preconfirmer and proposer, allowing anyone to act as a preconfirmer (gateway) while still achieving absolute settlement certainty through delegation from proposers.
Key Benefits to Validators
- Delegate sequencing duties while retaining full operational control.
- Earn additional passive income through secure delegation.
- Maintain robust security with isolated slashing risks specific to the sequencing layer.
System Architecture and Components
The LingLong Pre-Settlement Layer consists of several interconnected smart contracts that work together to enable the delegation and commitments from validators.
Restaked Services
The Restaked Services in LingLong leverage existing restaking infrastructure like Eigenlayer and Symbiotic to create a layered security model with isolated risk and rewards.
- Restaked Validator Service (RVS)
The Restaked Validator Service enables Ethereum validators to make credible commitments beyond Ethereum’s core consensus by restaking through platforms like Eigenlayer and Symbiotic. This service forms the foundation of the Pre-Settlement Layer, allowing validators to:- Delegate Specialized Duties: Validators can delegate sequencing and other duties to specialized restaked services without giving up operational control.
- Maximize Yield Opportunities: Validators can earn additional passive income through trustless delegation to other restaked services.
- Maintain Security Guarantees: The service preserves Ethereum’s security model through clear risk isolation and fault attribution mechanisms that ensure Ethereum base layer validators are not subject to slashing risks from sequencing activities. Slashing penalties are confined exclusively to the sequencing layer.
- Participate Without Technical Overhead: Validators can contribute to the rollup ecosystem without implementing complex technical infrastructure.
- Restaked Gateway Service (RGS)
The Restaked Gateway Service manages a network of sequencing gateways and sequencers (such as Gattaca, Espresso and Radius) that receive delegation from validators to sequence based rollups. This service creates a marketplace where gateways compete for the rollup sequencing right, and channel value back to validators.
Smart Contracts
- Universal Registry Contract (URC): Immutable and permissionless validator/gateway registration.
- Slasher Contract: Enforces penalties via fraud proofs, with interactive/non-interactive slashing for fairness.
- Rollup Registry Contract: Manages rollup registration and configurations of sequencing customization.
Delegation and Restaking
In the LingLong framework, delegation can be seen as a transformation of blockspace futures: Validators effectively “sell” future blockspace under fine-grained conditions, enabling trustless delegation of any rights they hold.
This approach extends beyond rollup sequencing, allowing validators to monetize various rights via the Restaked Validator Service (RVS) and generate additional passive revenue streams as the Ethereum ecosystem grows.
One example is blobspace delegation, implemented as Luban’s Taiyi. Similar to sequencing delegation, Taiyi allows validators to delegate their blobspace allocation rights to specialized underwriters. These underwriters optimize and manage the selling of future blobs across multiple rollups, leading to:
- A smoother data availability (DA) submission process for rollups.
- More predictable costs and enhanced certainty.
- Premium revenue opportunities for validators.
Flexible Restaking
Delegation is secured by a flexible restaking model that accommodates different risk appetites:
- Native Restaking:
Validators can leverage their own staked ETH, fully capturing the resulting revenue while assuming the associated risks. - External Restaking:
Alternatively, validators may source external restaked capital. This approach isolates their ETH stake from delegation risks, offering a lower-risk path to earning yield.
This dual approach ensures that validators can choose the strategy that best aligns with their risk profile and yield objectives.
Rewards and Slashing
Validators in LingLong earn rewards through two main channels—block rewards and delegation rewards.
1. Block rewards
RVS supports the current PBS (proposer-builder separation) setup and MEV-Boost auctions. Opt-in validators continue to receive block rewards from block builders.
2. Delegation rewards
Restaked services such as the RGS act as agents for RVS validators, capturing value (e.g., from rollup sequencing) and returning revenue as delegation rewards.
Service-specific Auction
The goal of restaked services is to maximize returns for the RVS. Therefore, we expect most restaked services to implement auctions.
For instance, the RGS periodically auctions sequencing rights to gateways, with all proceeds going to RVS validators.
Slashing
Validators are generally protected from slashing unless they act maliciously—for example, by delegating the same rights to multiple services.
Slashable Events (for RGS delegation)
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Missed Settlement: The validator fails to include RGS settlement transactions, causing liveness failures on the based rollups.
Example: Validator Alice has delegated the sequencing rights of Rollup A to RGS. In Alice’s slot, a gateway selected by RGS sequences Rollup A and submits the rollup batch to Alice. However, Alice fails to include the batch, preventing Rollup A’s state update from finalizing on L1.
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Replaced Settlement: The validator includes non-RGS settlement transactions, intentionally violating their commitment and disrupting rollup finality.
Example: Validator Alice, after delegating Rollup A’s sequencing rights to RGS, receives the correct batch from the RGS-selected gateway but chooses to include a different batch instead, effectively re-orging Rollup A from the user’s perspective.
Validator Integration
How Luban benefits Lido validators
Luban enhances the agency of Ethereum validators by offering customizable risk profiles without disrupting their existing revenue streams. It opens new yield opportunities while aligning with Lido’s commitment to stability and reliability as the largest liquid staking protocol on Ethereum. Its permissionless design ensures that Lido validators remain at the forefront of ecosystem developments, all while preserving neutrality.
How Luban manages the risk for validators
Risk isolation is a cornerstone of Luban’s design, ensuring validators remain protected across three key areas:
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Slashing Risk:
Luban employs an agent-based fault attribution model where penalties are directed only at the party with operational control over a failure. This means validators (principals) are insulated from faults arising at the delegation level, particularly those related to based rollup sequencing.
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Pricing Risk:
For delegations that involve pricing future resources—such as blobspace delegation—Luban relies on specialized service providers to optimize pricing through competitive, auction-style mechanisms. This process secures validator yield in advance and protects against underpricing risks. If a blobspace underwriter misprices the resource, they absorb the loss, ensuring validators’ revenue remains unaffected.
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Regulatory Risk:
Clear legal demarcations in the delegation structure shield validators from regulatory liabilities. Should a restaked service provider engage in non-compliant activities, validators are not held responsible due to the inherent separation of legal responsibilities.
Integration guide
LingLong is going live on both Holesky and Hoodi testnet. Node operators interested in testing the framework can follow this integration guide and directly contact us to schedule live setup sessions.
Please note that only Holesky is currently available due to the previous absence of Eigenlayer and Symbiotic deployments on Hoodi. We will update the integration guide with Hoodi-related information soon.
Adherence to the APM framework
Luban follows the APM framework in its integration with Lido node operators. Its three core components are:
- Mechanism: Pre-settlement
- Protocol: LingLong
- Sidecar: Commit-Boost
This post serves as a general introduction of Luban to the Lido community. A PERCH proposal will follow after incorporating feedback from node operators and the broader community.